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FBI probes 530 corporate fraud cases
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(February 12, 2009 - Thursday) - Devlin Barrett ASSOCIATED PRESS
Thursday, February 12, 2009
http://www.washingtontimes.com/news/2009/feb/12/fbi-investigating-530-corporate-fraud-cases/
FBI agents are conducting more than 500 investigations of corporate fraud amid the financial meltdown, FBI Deputy Director John Pistole told the Senate Judiciary Committee on Wednesday.
The disclosure came on a day when it was revealed by Massachusetts' top securities regulator that the wife of disgraced money manager Bernard Madoff withdrew more than $15 million from a firm co-owned by her husband - including $10 million on the day before his arrest on charges he ran a $50 billion Ponzi scheme.
And in New York, Attorney General Andrew Cuomo laid out further details about $3.6 billion in bonuses Merrill Lynch & Co. executives received, calling the investment bank's executives irresponsible. Mr. Cuomo detailed the size and scope of the bonuses in a letter sent to House Financial Services Committee Chairman Barney Frank, Massachusetts Democrat.
In addition to the corporate fraud cases, Mr. Pistole told lawmakers FBI investigators are tackling an even bigger mountain of mortgage fraud cases in which hundreds of millions of dollars may have been swindled from the system.
Mr. Pistole said there are 530 active corporate fraud investigations, and 38 of them involve some of the biggest names in corporate finance in cases directly related to the current economic crisis.
In the Madoff case, Massachusetts Secretary of State William Galvin said Ruth Madoff, 67, withdrew $5.5 million on Nov. 25 and $10 million on Dec. 10 from Cohmad Securities Corp., a New York firm co-owned by her husband.
Mr. Cuomo in his letter to Mr. Frank said, "... it appears that, instead of disclosing their bonus plans in a transparent way as requested by my office, Merrill Lynch secretly moved up the planned date to allocate bonuses and then richly rewarded their failed executives."
Both Merrill and Bank of America could face charges of securities fraud in New York as the attorney general's office investigation unfolds, according to a person familiar with the investigation who requested anonymity because of the ongoing nature of the matter.
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